La. Lottery’s New Math

NEW ORLEANS–It came as no surprise two weeks ago when the Louisiana Lottery awarded the creative portion of its ad contract to sole finalist Sides and Associates of Lafayette, La. Few observers guessed, however, the much smaller of the two accounts up for review would be the most profitable.

Sides’ scored well ahead of the other two bidders for the $765,000 creative account, racking up 80 points on the written proposal compared to 55.53 for Keating Magee and 51.95 for the Montgomery Stire and Davis Partners joint venture. When Sides became the only finalist, it was a foregone conclusion that the shop had won creative duties.

The lottery’s apparently more lucrative $4.8 million media planning and buying account went to Graham Group of Lafayette, whose 83.31 points beat out second finalist Sides with 72.16 points.

While Graham’s cut of the media account was expected to be greater than Sides’ creative windfall based on past numbers, an unexpectedly low bid turned the tables.

Graham’s bid for the media account was substantially lower than the previous year’s contract with a 4.5 percent fee of nearly $210,000–a savings of $367,000 from the $587,000 paid last year.

Sides will receive a substantially higher commission than did incumbent Bauerlein Advertising of New Orleans, which had handled both the creative and media components of the account. Sides’ $249,600 annual fee–or $20,800 per month–for the creative portion comes to nearly 32.6 percent of the $765,000 budget.

John Caruth, general counsel for the Louisiana Lottery, said the agency fee for the creative account skyrocketed this year because ‘there had to be enough compensation for the amount of work laid out in the (request for proposal).’